Mineral Resources Limited

Mineral Resources reported FY '26 revenue of $6.5 billion, up 44%, and underlying EBITDA of $2.6 billion, up 183%. Underlying NPAT was $822 million compared with a loss in FY '25. Mining Services delivered record EBITDA of $976 million; iron ore contributed EBITDA of $1 billion; and lithium delivered EBITDA of $771 million. Operating cash flow, excluding the Onslow Iron carry loan and iron ore prepayment, was $2.6 billion, with 102% cash conversion on underlying EBITDA. Free cash flow was $849 million after $1.1 billion of capex. Net debt fell by around $1.1 billion to $4.3 billion, leverage declined from 5.9x to 1.7x, and liquidity increased to $2.4 billion, including $1.6 billion cash and an undrawn $800 million revolver. The Board declared a fully franked final dividend of $0.83 per share, equal to a 20% payout of underlying NPAT. For FY '27, Mining Services production is guided to 370 million to 390 million tonnes, up 9% to 14%; Wodgina sales volume is guided to 360,000 to 390,000 tonnes of SC6 with FOB cost guidance of $640 to $710 a tonne; FY '27 capex is guided at $1.425 billion pre-financing, or $1.27 billion net financing basis, and sustaining capex is guided at $815 million. The POSCO transaction is expected to deliver about USD 765 million in gross proceeds when completed, which would take net debt to about $3.2 billion and leverage to around 1.2x on a pro forma basis.

Chris Ellison framed FY '26 as a milestone year, emphasizing 20 years of growth from a small contractor to a diversified resources company with record revenue and EBITDA. He stressed that Mining Services remains the company's “heartbeat,” highlighted Onslow Iron as a company-changing asset, and said the business now has stronger governance without losing entrepreneurial speed. His tone was upbeat and confident, with a clear message that MinRes is moving into FY '27 with momentum, balance-sheet flexibility, and optionality for further growth.

Mark Wilson focused on earnings quality, cash conversion, and deleveraging. He said FY '26 operating cash flow was $2.6 billion, free cash flow was $849 million, net debt fell to $4.3 billion, and liquidity increased to $2.4 billion, which he said is well above the company's $1 billion minimum. He also noted debt-market actions that lowered the weighted average cost of debt from 8.6% to 7.4% and should cut annual finance costs by more than $60 million, while extending weighted average debt maturity to nearly 5 years. On capital allocation, he said the framework is balance sheet first, disciplined brownfield growth second, and dividends when leverage is on a path to below 2x within 12 to 18 months; he also confirmed FY '27 capex of $1.425 billion gross, or $1.27 billion net.

Analysts focused on the sustainability of Mining Services volumes and margins, the timing and capital structure effects of the POSCO lithium sell-down, and how the company will balance dividends against growth opportunities. Management said the Mining Services pipeline is strong and that a large share of the upside is external, while Chris Ellison said the company is still looking for domestic and offshore opportunities, especially copper. On dividends, Mark Wilson said the $0.83 per share payout is for the full year, not just one half, and that future distributions will depend on balance-sheet strength and opportunities, with leverage targeted below 2x within 12 to 18 months. On the POSCO deal, management said proceeds will mainly reduce debt and preserve flexibility, while confirming the business will still consolidate the assets because MinRes retains control.